tv Press Here NBC August 29, 2010 8:00am-8:30am PST
is google evil? the search engine sparks protests over net neutrality. what is net neutrality, anyway? and why is everybody so fired up about it? we'll put that question to lawyer christina gagnier. and your customers are using twitter to talk about you. so why isn't your company empowering employees to talk back? best-selling book author and business analyst josh bernoff. our reporters this week sarah lacy of techcrunch and joseph menn of the "financial times," this week on "press: here." good morning, everyone. i'm scott mcgrew. all men may have been created
equal, but not data. some data is more important than other data. in a medical emergency your health records traveling across the internet are more important than video of a cat playing a piano. well, more important to you, anyway. which means in the increasingly crowded cloud america has to figure out some way of treating data. there are two schools of thought on this. the first is to treat all data equally, both the cat and the catscan. this is net neutrality. you may have heard that term. it's how the internet works now. all data, whether it's a tv show -- >> introducing the new ipod pequeno. >> reporter: -- or e-mail or naughty picture or spreadsheet, all 1s and 0s are given equal treatment. the switches that handle internet traffic do not play
favorites. proponents of net neutrality point out this levels the playing field. a little internet startup has just as much right to the information superhighway as apple or google. the alternative is a tiered internet. medical records move faster, perhaps, or video is given priority. google, along with verizon, recently proposed wireless internet providers be allowed to create a tiered internet. the company that pays gets preferential treatment. an idea that these internet users and even some google employees called evil. >> don't be evil. don't be evil. >> christina gagnier is a lawyer with examinees eexpertise in i elect'll privacy, net neutrality. she's also a reporter for the huffington post. also joined by sarah lacy of techcrunch and joseph menn, correspondent with the "financial times," first time on
the show. welcome to it. let's start with the basic understanding of net neutrality. why does the average person who's not involved in dotcoms, who's not a shareholder in some of these companies, the average person at home, why do they care? >> well, i think the simplest explanation that i've ever heard is let's say you're sending an e-mail to grandma and you just want to, you know, tell her what's been happening with your life. you just want to ensure your e-mail's going to go through. a company's not going to stop your e-mail from being transmitted to grandma or it's not going to slow it down. and that's really what net neutrality is about. >> my e-mail, regardless of how not important it is, at least to everyone else. to my grandmother it's very important. >> yes. >> it gets treated the same way as everyone else. >> yes. >> now, this has always turned into a moral issue, particularly in silicon valley. i don't know anyone in silicon valley except for clearly someone at google who thinks that there should be data prioritized in certain ways. i mean, it seems a no-brainer to
those of us, especially at techcrunch and the start-ups that we cover, that tiering the internet is a bad idea. is there something that we're missing? >> i think what really the debate comes down to is that the internet has -- the infrastructure of the internet has been built by these companies. and it's true. comcast, at&t have provided the infrastructure we've all come to know and love. it's become such a big part of our lives. what they're crying is network management that is becoming so unwieldy, especially with the mobile internet that something has to be done. that's really been why especially in congress over the last seven years the bill has not made it through. the internet freedom preservation act hasn't made it through because of the lobbying of at&t and their concerns about network management. and i think that's where the issue really gets tricky, is that even though they are responsible for this infrastructure they have to realize the industry that's built on top of it. and i think from silicon valley and even in l.a.
>> but isn't that their problem? if the infrastructure isn't scaling to meet the users' demands, isn't that why they're a for-profit supposedly technology communications company, to fix that problem? >> that's absolutely -- >> you said they're providing it like it's a service. this is a business. we pay them a lot of money tore access to the internet. i mean, it's sort of their problem if it's not scaling enough. >> i think that where they're concerned is that they're going to have to build out more infrastructure in order to make the internet stay the way that it is. i mean, initially, 1995 when people started using the internet there were so few users. and i'd say in the last five years we've seen usage rates skyrocket. laptops are more affordable. computing devices generally are more affordable. i think that's why we're seeing so many more people on the internet. not to mention the iphone, the blackberry and the other things we use to -- >> and i think joseph menn's readers would say at "financial times," would say you know, free market. if i'm willing to pay more, either as a consumer or as a company for faster internet
access for my data or sending things through, free market i ought to be able to do that. >> that's certainly the perspective of the isps. and they have a point. i mean, when all the stuff was built in, they didn't have the peer to peer traffic that's been exploding that caused comcast to start trying to tinker with the speeds, and they didn't have the video explosion that's happening now. the bandwidth consumption is dramatic. it's going up in a huge way. and why shouldn't those companies have a right to say this traffic can move a little faster, the cat video just isn't as important, particularly if they disclose it. and transparency is one of the big issues here. >> and you said the c word. >> cat video? >> no, comcast. i want quickly an explanation as to how comcast fits into this. so the viewer understands, nbc, which owns this television station, is in the midst of a -- essentially a merger out of one company into comcast for a separate company that has not occurred yet, but i wanted to
just get that ownership thing out of the way, that eventually this tv station will be a comcast television station. but not yet. so say anything you want. comcast in some ways launched this. they started changing the way that people use the internet, at least a specific group, right? >> yes. >> tell me about that. >> the way comcast is very much involved in this issue is one they were the company found to be doing deep packet inspection, which is basically they were looking at the little packets of data, your e-mail address, your cat video, whatever you were using the internet for, and they were slowing down traffic. that's really where comcast involvement in the situation came. the fcc started holding hearings in 2008 and the fcc came down way decision that came down against comcast. that decision ended up in the court of appeals and the d.c. circuit decided that the fcc didn't have the authority to go after comcast in any way. they didn't have the regulatory power. that's where we're sort of stuck right now, is that the fcc is between a rock and a hard place. and most recently they decided
they weren't going to do anything, which is where the google-verizon pact came in. >> before we get to the google-verizon, if the fcc isn't in charge of making sure everybody's playing fair, who's in charge in the court didn't say. >> no. and the fcc, one of the things -- the third way plan, which is basically that the fcc would reclassify the way that it looks at net neutrality, so before it was under one classification, ancillary broadband services, they could make it a telecommunications service. and me reclassify how they look at net neutrality, they do have the regulatory authority to do so. congress has proved to be ineffective. the bill has been in and out of congress for seven years. it's not going anywhere. so it really was going to lie on the fcc to make a decision one way or the other. >> i want to talk about what's going to happen next with the fcc and some of the potential things there, but we're going to break for commercial. we'll be back in 60 seconds.
welcome back to "press: here." christina gagnier is a lawyer with some expertise on net neutrality. we've been picking her brain. google and verizon had a meeting of some sort. what was that meeting about, and how does that affect our understanding of net neutrality? >> google and verizon formed a pact, and the pact essentially is just their recommendations on what the net neutrality policy should be. first and foremost, it is not a law. it's not going to be any sort of a rule that anyone's obligated to follow. the fcc can or cannot adopt it. congress can or cannot look at it and decide if it's going to be something that they're going to consider. but essentially what it does is lay out ground rules. now, first and foremost, it does mention things like transparency, which we discussed a few minutes ago, and it lays out some of the other tenets that net neutrality advocates have been in favor of. what it doesn't do, though, is it doesn't address wireless services, and that's actually one of the largest issues with net neutrality, is the fact we want to make sure that net
neutrality applies also to wireless services especially because like many of us we use iphobes and blackberries, and that's really where internet consumption is going, is on mobile phones. >> there were a couple really surprising things about that pact, one is that they said anything goes in wireless, there doesn't need to be any regulation on that. and the other is they said you can create a second tier if you want to with certain conditions. how would that work? are we going to have isps offer certainly -- a second kind of internet where they can do whatever they want? and who would sign up for that? >> the concern over tiered services dates back to about 2007 and the idea would be that for basic internet access, so for e-mail, some of the websites that we surf, there would be like, you know, $19.95 plans, which currently exist, and then for more bandwidth, so if you want to do more video stuff or if you're a high-bandwidth user then you would pay higher rates. where that becomes a problem is there's a lot of people in this country that don't have internet access, and i think we're overlooking that in the net
neutrality debate. where do those people get left? they get left with a subpar internet while people who can afford the better internet are going to have more access to information. >> there would also be an incentive to the isp to make sure you did want to move up to the next level, that if my low tier, my basic entry-level internet were working just fine, actually, i was getting some pretty high-speed stuff, that would disincentivize me to move up, so that would incentivize the internet to slow it down. >> frankly, the u.s. is already lagging compared to other countries when it comes to internet speed, cost. i mean, we're already -- we're not doing so great. it's like do we really want to encourage the companies that basically have an oligopoly around this market to put up more and more road blocks and barriers? i'm sorry, i just don't have any sympathy for these guys saying oh, traffic -- we didn't anticipate youtube. it's the technology business. microsoft -- >> i -- >> security breaches. guess what. it has to adapt to them.
>> i have sympathy every time i want to make some sort of important thing on an iphone and somebody's using pandora. which i love. let me ask you, what do we do now? where does it go? what should we be watching for in the newspapers as far as this issue goes? >> i think what the fcc's going to do next. they've decided -- currently they decided not to do anything, but i think that's going to have to stop. the fcc definitely is going to have to take up this issue. i don't think it's going to be resolved through congress. and the real fear against the fcc taking a position is there's a lot of people that don't want more government regulation. well, this is a case where we've had 15 years without regulation and we do need to preserve the internet that we all have come to know and love. the fcc is going to have to do something. they've been having hearings the last two years. you would think by now they could have come up with a plan, and they haven't. and michael copps, one of the fcc chairmen, i think he's disappointed the fcc backed off from this but we're not seeing the leadership from chairman
janikowski and the obama administration who came in touting that as one of their goals. >> i was shocked that after google and verizon announced their deal the fcc which had said it was going to try to have a meeting of the minds on this just said okay we'll call it off now. it just seemed like an abdication of a pretty big responsibility. >> what are the political tea leaves? people always talk about net neutrality and this is going to be, you know, a big push for us, this is so important or, you know, companies need to be able to make money. there's a lot of grandstanding. why doesn't it get done? why is it dead in congress? what is going on behind the scenes that's making this a stalemate? >> a lot of lobbying. and the other thing that's making it a stalemate is just this idea of regulation. people are very scared of regulation. i saw this article where some members of the tea party were interviewed. and they were afraid of net neutrality cathy a chinese-style internet. so obviously, what net neutrality is, net neutrality's a horrible name. internet freedom, any other title than net neutrality would be better communication piece in terms of explaining it to people. people just have a misconception of what it means.
they think more regulation means they're not going to have access to the internet or they're going to lose some sort of a free speech right. well, it's exactly the opposite. so i think that's where things are breaking down in terms of the american public really getting behind this and taking a position. >> i'm sorry, joseph, i'll have to leave it there. christina gagnier, thank you for being with us. up next on "press: here," does your company empower employees to use twitter and other social networks? it should. josh bernoff, author of "empowered: unleash your employees, energize your customers, and transform your business," up next.
go to fres pressheretv.com click on chat live and there you go. there are no limits these days to the ways customers can react to business whether that's you the viewer telling us what you think about the show or a restaurantgoer making a comment on yelp or an airline passenger complaining about baggage handlers. ♪ ♪ should have gone by car ♪ because united breaks guitars ♪ >> the music video "united breaks guitars" is now world famous. a little ditty posted to the internet by a musician who felt united airlines was at fault when his guitar was damaged in flight. ♪ united
♪ you broke my taylor guitar >> reporter: one of the classics in online attacks is "yours is a very bad hotel." a set of powerpoint slides that traveled the internet by e-mail illustrating the career path of a rude doubletree hotel clerk. it's been seen tens of millions of times. >> and to just say good-bye, we're not interested in you anymore, is a big mistake. >> reporter: with that kind of power in the hands of customers author josh bernoff says they must allow their employees the same access to social networking. in his new book "empowered" he says companies must be ready for a world that moves at the speed of twitter. josh bernoff is senior vice president at forrester research, the magazine advertising age said his earlier book "groundswell," which he co-authored, is the best book ever written about marketing and
media. that is a blurb. he's joined by joseph menn of the "financial times," sarah lacy of techcrunch. companies are aware that they can be destroyed by very popular bloggers, people on twitter. maybe not destroyed. definitely affected in very negative ways. i think they're less aware of what you're saying, that it's time for them to get back and start talking on twitter and blogs. >> yeah, this is as much about the employees and their relationship to the company as it is about the company. in this world where people can have so much power like dave carroll and "united breaks guitars," the only alternative is to empower the employees in your company to come up with solutions, to reach out to those customers. but most companies are not structured in such a way that these people who have these innovative ways about how to do that can actually act on those ideas. and that's what we're trying to change. >> and most companies would say my employees can talk -- they have to go through legal and they'll talk to marketing and marketing will go back and talk to legal and then we'll address the problem. >> i mean, if you're a publicly
traded company, let's say you're apple, a company that really prides itself on secrecy, and you're working on something really clever and you walk out and tweet, i was just in a meeting with steve, you know, got a pat on the back, that could move the stock. i mean, there are reasons that there are some fences around employees, right? >> well, apple is the archetypal counterexample because apple works based on the brilliance of a guy at the top and it's run in a completely different way from most companies, where actually listening to and acting on what the customers say makes a difference. so if you're in any of the millions of companies other than apple out there, you have to worry about whether dave carroll's going to be writing about you or whether the people visiting your hotel are going to be writing about you. and the fact is people are now coming up with ideas for mobile applications on iphones. they're building customer communities. they're doing video sharing sites. these are the kinds of ideas that people in marketing,
customer support are coming up with. the company should be supporting that activity when it's in line with the regulatory rules there and also with company policy. >> one of the things i read in the book is people say i don't want these young upstart employees speaking for our large company. you said that most of the people who say let's get out there and do this are not rebels. they're pro company. they're fans of their own company. they're not the wild-eyed rebels. >> if you're a customer service person you're in the best position to see what might need to be changed. if you're a marketing person you might say oh, look, you know, all this activity's happening out on the internet, why can't we be a part of this? and it used to be that technology was something that was expensive and you needed to go to the i.t. department for. we see people now in marketing and sales and customer service creating these applications and in companies like best buy that encourage this sort of activity they're actually able to reach out at that speed of internet, at the speed of social
technology in a way that's just not possible in a more rigid company. >> but still, there have to be huge caution flags here. i'm just imagining if a customer complaint can go viral like some of the examples we've seen, imagine what will happen to a poor employee response. i'm thinking of the airline flight attendant that made the dramatic exit recently. wouldn't it have been great if he spoke his mind about the company on twitter before he jumped? >> and best buy, you're championing them. there was a guy who made a hilarious iphone 4 video which in no way affiliated him with best buy, did not look like it was a best buy ad, got fired and created a huge black eye for the company. so if you put yourself out there and tweet as a best buy employee, are you also not allowed to tweet as joe schmo the individual? >> this is exactly what the book is about. if you're going to set up a company to do this, there have to be rules and policies in place. the first thing is you have to educate the people in your company as to what the strategy is and what's appropriate.
because this is not about let everybody chaotically do whatever they want. you also have to recognize that when you have a problem, when an employee behaves like that flight attendant, that's a personnel problem, that's not a technology problem. cutting people off from technology doesn't solve it. they go home and they write it on facebook on their own time. >> sorry to interrupt, but i was just thinking that the counterpoint of that is when you do have a disaster, a bad employee, something that's gone wrong, if you have already those structures in place to immediately be out there talking to the blogs, to immediately be posting your own youtube videos, you're actually beating people to the punch. you can damage control as well as have good employee relations. >> yeah, we actually have three rules, which came from some of the companies we've seen that have done this, that employees are supposed to follow and they need to know. the first one is don't be anonymous. you have to say who you actually are. the second is remember that you're an employee.
right talking about financial information is illegal and inappropriate regardless whether you do it on facebook or some other way. and the third is if you make a mistake fix it. all of these environments provide ways for you to add a comment to what you already wrote or respond to what somebody has said. and then the little problem doesn't become a huge problem. it gets fixed in time to not be a problem for the company. >> there are regulatory things that companies probably haven't thought of. you use the best buy example, and i assume you're talking about twelp force, which is their ability to get out and get on twitter and answer twitter questions run by this sort of large collection of best buy employees. there are regulations involving when the best buy employee twitters from home and i'm not paying him but he wants to. there are things that companies will have to deal with that they've never had to deal with before. >> well, twelp force is a great example because that exists because of the way best buy runs. the best buy ceo barry judge says we encourage people to have half-baked ideas.
but that doesn't mean they put them out there when they're half-baked. when that got launched, john bernier, a guy in marketing had to deal with the labor issues and come up with rules on how it would get used. and now 2,500 best buy employees can respond to your twitter, but there are rules they need to obey so they don't run afoul of labor laws labor laws. if you're a pharmaceutical company you can't be out there promoting a drug in a way the fda has not approved. so living within regulations is a part of this but that is a policy issue not a technology issue. >> i think you also cite comcast customer service as being fairly aggressive on this. and i hate to -- you've already done your comcast disclosure -- i thought we were covered on that. but i haven't seen customer service ratings go through the roof. it's still -- no offense. they don't own the station yet. it's terrible. i don't see the -- >> i don't think they care at all. >> well, here's -- let me see if i can contradict you a little bit. >> yeah. >> i've covered the television industry for a long time before
i became a social media analyst. and if you look at the customer service rankings, comcast has actually improved by a number of percentage points since they started this. they have put hundreds of millions of dollars into improving service. now, you might say they've gone from awful to not so bad, but they're moving in the right direction. and the idea that if you have a problem you can tweet it and they actually come out and help you, that's just an indication that you know, maybe they do care a little bit. >> isn't that just a radical shift that so many companies don't understand, though? even if you're going to disagree with me, even if you're going to deny me my claim or my refund, somebody talked to me. >> i mean, there is a basic problem with customer service that isn't a technology problem. i mean, if i'm at a hotel and i'm sitting there talking to the night porter or i'm at the united counter, i mean, this isn't something where someone can't interact with me. i'm just frequently getting bad customer service because they're getting snippy, they don't want to hear my complaint. i mean, an angry customer just needs to be heard.
>> that's right. and i will say this. that reaching out through the internet for customer service is not a solution for having a poor service reputation or doing poor service. you've got to fix the service problem first, then you have to reach out in these new ways to show that you've actually done that. >> josh bernoff's book is "empowered." we'll be back in just a minute.
a singer whose guitar was broken. he travels the business circuit talking about his experience. and he does fly united. which lost his luggage. that's our show for this week. my thanks to christina gagnier and josh bernoff. his latest book, "empowered," will be in stores september 14th. i'm scott mcgrew. thank you for making us part of your sunday morning.